Peruvian Agrarian Reform Bonds



The Republic of Peru is a trusted ally of the United States and a fiscally responsible sovereign. Peru has established and continues to advance a bondholder procedure that provides a global solution for the unique historical issue of agrarian reform bonds. 


Agrarian Reform Bonds. The agrarian reform bonds are physical bearer instruments provided almost a half a century ago as compensation for land in Peru, in Peruvian currency and subject to Peruvian law and jurisdiction. Unlike some contemporary bonds, they were not offered publicly, listed on an exchange, issued into the U.S. market or subject to foreign law or courts. Decades of currency changes and hyperinflation resulted in uncertainty as to the legal status and value of the agrarian reform bonds. 


Bondholder Procedure. After years of uncertainty, the Peruvian Constitutional Tribunal mandated an administrative procedure and methodology for valuation.  Peru correspondingly adopted decrees and established the administrative procedure for bondholders.  As the procedure advanced, Peru adopted additional decrees relating to the final steps of the procedure and the methodology for valuation, culminating in Supreme Decree No. 242-2017-EF of August 19, 2017.  Steps in the procedure include:

  • Verification: Bondholders may submit their bonds for authentication of physical instruments, and registration in the administrative procedure. 
  • Valuation: Registered bondholders may request a valuation of bonds pursuant to the methodology for determining the current value of the agrarian reform bonds, in accordance with applicable law. Bondholders also can calculate the value based on publicly available information. 
  • Payment: Registered bondholders may choose from various forms of payment, including sovereign bonds, State land, cash, and swaps for investment.

Numerous bondholders have been participating in this global solution. The deadline to submit bonds for verification is January 19, 2019.

Related Information: A U.S. based fund, Gramercy, has attempted to undermine the duly established bondholder procedure for its own benefit, at prejudice to Peru, Peruvians and bondholders.  Rather than recover value through the bondholder procedure, Gramercy launched a negative campaign against Peru and notified an arbitration under the U.S.-Peru Trade Promotion Agreement seeking to force Peru to make exorbitant and unlawful payments to Gramercy.  Peru filed a strong response indicating the grave deficiencies in the case.  After Gramercy declined further consultations, and continued its campaign of misinformation, Peru advanced the arbitration to protect the bondholder procedure for the benefit of bondholders.  The case is pending.  Peru has a diligent and successful record in investment disputes.

Information for Bondholders: Bondholders may participate in the bondholder procedure.  Information is available through the Ministry of Economy and Finance, and at

Washington, January 9th, 2017